China Minsheng Banking Corp Ltd Class A
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
¥9.30 | Rfkv | Wzlt |
China Minsheng’s Assets Cleanup Made Progress Despite Lingering Credit Quality Challenges
No-moat China Minsheng Banking, or CMBC's, second-quarter results showed a continuation of higher-than-peer pressures on both loan growth and net interest margin, or NIM, as the bank struggled to derisk its loan book amid surging economic headwinds. Management’s two-year reform to clean up asset risks and lower fund costs in 2021 and 2022 was complicated by sluggish loan demand and growing risks in retail-and property-related sectors. Given the results were largely in line with our expectation, we retain our fair value estimate of CNY 4.00 per A-share and HKD 4.50 per H-share.